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okay i admit i'm confused we had a lot of great feedback from responses from the podcast we recently did on is snop dead if you haven't seen it check that one out but i'm still confused about the steps of an snop process i've seen anywhere from 15 monthly steps to as little as four so who's right i'm going to tell you and we're going to show you what the best practice is now let's get to it welcome welcome welcome ibf on demand with your host eric wilson and your sponsor your one plan snop software solution akiva happy to have you on board and guess what it's my birthday so when you're this is actually airing if this is going to be my birthday week when this is aaron so please it's not the thought it counts it's the gift so if you can because it's my birthday and i'm asking you you need to like this podcast comment down below tell me happy birthday that's what i want to hear because i'm lonely i'm by myself and i need to hear that from people to make me feel a little bit better about myself so please tell me happy birthday that's what i'm asking for you today and you want to send gifts feel free as well and don't worry even if it's not this week it's a year later when you're viewing this you can still send me something i'm always up for good gifts this is another great episode of ibf on demand and we're going to be talking about snop today and i said i was a little bit confused we had some great feedback from the last podcast we did but that got into more questions exactly about the process and what exactly is this snop process on a monthly basis because there's a lot of ambiguity about it i said i've seen anywhere from as far as 15 different steps that incorporated anything and everything part of a business process to just a simple four-step process everything in between if you want to look at what the traditional snop process was back in the early 90s it was an easy stair-step process five basic steps data gathering demand planning supply planning a pre-snop and executive snop and you still see that a lot of times especially in training people go through back to the way it's always been taught but is that the right way to do it and teach it now and i wanted to find that out and like i do with anything when i want to try to find out i go to the experts i go to the companies that are best in class right now i go to the people that's training and teaching this on a daily basis and i get all that feedback and come back and i present it to you and that's what i did with this as well i asked the experts i asked a lot of i said the top companies some of the top people in the field and i got a lot of responses and surprisingly despite all the different things you can find out there about the different types of snop processes they were all pretty much the same most of the top companies are doing things the same way and most of the people that understand this and are teaching it have adapted and are starting to teach it a very similar way as well one of those conversations i had was with one of the experts i think in snop ibp process and we had a very long phone conversation and somewhere in that phone conversation we said i need to share this with the audience as well that's when i decided to bring pat bauer on pat bauer to be able to talk about snlp ibp process and that's what we're going to do today me and him going to try to recreate that conversation they said there's a two-hour conversation don't worry we're not gonna hold you in for two hours we've got about 10 minutes exciting content wrapped up in 30 minutes so stay tuned so we're going to talk a lot about snop and exactly what are those steps pat is a valued and frequent writer and speaker on supply chain subjects he is recognized snop expert and self-professed snop nerd prior to comb he served as a practice manager and supply chain planning and snop at a boutique supply chain consulting firm as well as he's a practitioner of many large organizations he even worked a little bit of time at a supply chain software company it was a full gamut anywhere from consulting technology to large organizations he was recognized four times by supply and demand chain executive magazine as a pro to know and consumer goods technology magazine considered him one of their visionaries he was the recipient of the inaugural ibf's excellent business forecasting and planning award as a self-professed snlp nerd to me an snop expert pat bauer as i said i'm honored to have pat pat welcome aboard i said i am honored to have you the snop nerd uh to talk about this so welcome thank you i i have a question i said i i'm confused and you get to help unconfuse me so my question is exactly how many steps are in an snop practice or or how many weeks does it take to get to the middle of a tootsie little tootsie pop i'm not sure i have the answer to the tootsie pop question and the the snop steps really kind of depends i mean different different processes and different schools of thought have have different counts so i've seen people with eight-step processes four-step processes eleven-step processes and five those are the ones that i that come come to mind off the top of my head two most common models are sort of the bob wallace i'm sorry tom wallace bob stahl model which has you know four four and a half steps of data prep demand planning consensus conversation a supply planning session or balancing process and an executive review sometimes on some of those models they're typically depicted in a stair-step fashion some of the models have like a a pre-step a pre-meeting to discuss any issues raised in the in the addition in the meetings prior and then there's sort of the ollie white step and if you go to conferences you'll occasionally see it and it's sort of a circle diagram it starts with an executive review at top going clockwise to a demand review then a supply balancing meeting or a portfolio review and then an integrated reconciliation or a pre-snop meeting and it's sort of a complete loop and i think both processes are loops they're just not necessarily depicted as such um one seems more stair step and it just sort of drops off and and the other sort of closes the gaps but it's really kind of a monthly interrupt looping process uh so what's the loop at the top when you have an executive review what comes down our decisions and decisions that funnel down to supply planning for their inventory planning purposes demand planning for some watch outs and some concerns portfolio management for acceleration or deceleration of products that are in the pipeline there's a strategy that loops back so the question really is it depends and then in execution you find all different variations on a theme you know some companies are so unbelievably capacity-bound that you'll you won't you won't see what really resembles a demand planning meeting they are essentially selling to capacity and you start you see this in like industrial chemicals and and where they're essentially selling time on a reactor vessel uh much how much product you can get out and then there's consumer goods companies where it seems like they're almost overweighted towards demand review seems to be more of a demand planning process and it just feeds the processing consumer goods because people are pulling in the trade inventory point of sale data extrinsic data on econometrics and whatever on whether like people are pulling in all different facts that would otherwise alter the the spending pattern of consumers so it tends to be it tends to feel very demand-centric and supply review or the balancing process seems to be kind of like an afterthought something that the supply geeks go and do it's not something that that's really part of a process so in execution there's all different levels of maturity inside that process i'm not sure she's crazy i hate using weasel words and the weasel word or expression that really comes to mind is it depends like it's not it really depends on the business on the industry and and and how how deep you want to go in your maturity journey to bring the snlp forward i think that's the real answer here yeah it depends it's my favorite answer so don't feel bad about that i said i actually saw a product centric company that actually had a you know you're talking about a supply demand kind of dominant i'd seen one it was product dominant as well you mentioned the bob stahl you know tom wallace kind of the original traditional five stair step uh from the early 90s is that i mean that was kind of what everybody you know where he benched mark ii for the longest time is that still a good model or has it started to adapt now with what we're seeing in data and other types of processes now i i think that's a perfectly fine standard i mean they they're cast a little bit different the original sort of the bob stahl i keep on saying bob stahl the tom wallace bob stahl model was very very it felt very supply focused at one point in time built very very uh master planning mrps uh growing up from the supply center company type of perspective where where the ollie white model and they were they're not necessarily done at different times they were done kind of coincident with each other it was just different philosophies as a matter of fact i think both bob and tom worked at ollie white at one point sometime i think they came out of the ollie white school um but they had their own take on it and it was a very supply center take very executive focused tape very they were talking strategy before a lot of other people were talking about the strategic integration so you asked bob today and he'll talk about it's an executive process with a small league so now now the one thing i've noticed though different i mean that you mentioned very supply focused mrp it was the early 90s and in the early 90s data gathering was an actual step was a process you had to go through on a monthly basis for an snop i think that's somewhat changed because the two biggest things i see best practices and what companies are doing today if you look at the coca-colas look at comb look at you know a lot of these companies that are really best in class when it comes to snop you weren't seeing that data gathering as a process step right now and the other piece is you're seeing product review as a new step in this process so i'm going to agree and disagree with you a little bit so i think uh the demand planning process that feeds the demand review is about as intense of a data gathering process as you'll find today and in the past i've been preaching this notion of of intimacy at an item level and a customer level every demand planner should know who the major customers are for any any of the a items and some of the b items that should have that depth of knowledge how do you get that through analysis where do you where you do that analysis you're you're kind of dissecting demand before the demand consensus meeting and you're putting out what you think is your it's a demand plan or led process that really digs and deep dives in on what's happening so i've always i've always been a proponent that that data then and now is no different you're still pulling trade inventory data you're still pulling pos data you're still pulling a ton a ton of data on the supply side you're pulling schedule adherence and inventory values and so there's a whole bunch of data collection that's happening now is it is it easier maybe maybe a little bit easier i'm not sure it's dramatically easier than it once was and there are bi tools and there's a lot of things that help get you data a little bit quicker but getting data quicker in the democratization of data doesn't necessarily replace the analytics that happened the analytics that happened the observations that happened in a demand planner's head or a supply planner's head it's like okay this happened but why did it happen and what questions helped me understand why my schedule adherence is low or why why a particular item grew faster than it was otherwise expected those those things are still happening and that's that's where demand planners and supply planners really add their value into the process as for portfolio management i've been talking about portfolio management for 20 years it's not something that's really new you see it a little bit more now because skus are just proliferating like crazy and people have a lot of different theories but i'll give you one really simple theory around why skus are proliferating right now e-commerce it doesn't have to go much far further than that you know there are people offering different packaging and different package designs to serve the e-commerce marketplace and that if you take a regular open stock item that you sell into walmart and you now convert it for e-commerce amazon is a three-pack or or differentiated one pack or some sort of special value proposition that's what's happening in the marketplace today that's why skus are growing dramatically and that's why inventory turn numbers look look unusual compared to what they did 10 years ago even so i there's a lot going on there so yes there is a proliferation of of skus portfolio management does become more important in there i'll tell you demand planning becomes very important there how do you peg demand for all these new differentiated packages serving a completely new channel so it's an interesting place that we're at right now it's an ever-changing marketplace and i'm not sure what what it ends up being on the back end of this and covet i think has precipitated more of a push into e-commerce not less obviously so i have an amazon box that shows up at my door every single day so i'm as guilty as the rest of uh of the world so i'm not sure if that answered your question eric yeah it did so if when so we definitely have portfolio as a intricate part of a best practice snop mature snlp process now when you're looking at that data you did a great job explaining that and i think we are a little more dynamic now you can look at daily instead of monthly in some cases or even hourly in some cases now with some organizations but is you mentioned that the analytics that's done with that data and there's a lot of other things that's done outside of an snop process and we had our call you mentioned too many people try to over complicate the snop process and put those as steps put those as part of an snop you had a great infographic that kind of laid that out and in your words all the other that happens outside of the standard process would that be the data would that be the analytics would that be the mrp capacity planning uh that be the finance you know financial reconciliation that would be the strategy all those pieces so talk about what's as far as a basic snlp and then what's all the outside stuff sure so so let's just start with a demand review in front of the demand review there's a whole demand planning exercise that happens for the first i don't know five to ten days of every month where your demand planner is going and digging into all the detail behind what happened inside of the the prior months demand inside in front of a portfolio review process there's all the conversations that happen whether they're staging aid or pre-launch or project planning around new product introductions or product renovations like a new formulation or product renovations like new packaging all of that happens in front of a portfolio meeting where the portfolio review meeting is really a summarization of all those activities and a progress check against it supply and demand balancing uh process that there is really the heart the supply review requires some amount of drp mrp uh sourcing work and most importantly a rough cut capacity planning exercise especially for those businesses that are capacity bound that happens in front of that meeting so all of the tools that are out there right now that are available to use for snop really just facilitate that data gathering and some of the initial generation of a plan they don't it's like a statistical plan is a good plan theoretically from a demand planning perspective but sometimes the math is bad sometimes the results are counter-intuitive and a demand planner has to say yeah no that doesn't work so there's a whole bunch of stuff that happens outside of the four steps or the five steps it happens in front of those processes that really drive the inputs and the conversation inside of those review meetings and that's what people just don't understand everyone's sort of obsessed with you know how many meeting numbers or what the how many um the number of meetings or the naming of the meetings and and honestly that's that's not the conversation it's how well are you integrating back into those other processes and how much data gathering and insight are you bringing forward into those meetings and a lot of companies really fail on the data inside okay so with that i think what you're saying is people try to put everything into the snop process try to solve their you know supply mrp drp left cut capacity demand life cycle management everything into an snp those are residual daily tactical operational sometimes strategic even processes that's done outside that helps feed a strong snop process is what you're saying right there's there's a whole bunch of garbage that happens outside um of the five steps and that garbage is unbelievably important to driving the conversation i say garbage i don't mean sort of way it's just there's a whole bunch of stuff that happens people's everyday work and everyday jobs that happen that that end up feeding the process i think people think that snop is just a five-step process and what that thinking is so far off about like let's sort of have a really simple conversation everyone talks about snop being a strategic process or strategy from how does that link and how does that connect someone's has set a strategy and someone has on the commercial side of the business let's just say someone set a route to market strategy which is the channels we want to go after the pricing inside of those channels and you know do we want to work the dollar class of trade as an example or do we want to work the drug class or trade all of those decisions are happen happen offline but that's the strategy of the business and the demand plan should reflect that and the product plan should reflect those strategies and should connect forward similarly the commercial strategy the products that you want to make sort of work in the park the product part of the four ps and sort of marketing parlance that should connect right into your stage and gate process into your pre-launch process into your project planning process and that should have direct connected into your portfolio management people don't connect how strategy connects how strategy allies inside of snop but it's really kind of very simple and the infographic that you talked about tries to illustrate those connections that was that was a great and and even i can understand that now so thank you so i think what we looked at then is we have a product review or portfolio review we have a demand review we have a supply review we have an executive snop executive review and then a lot of people put this pre snop or reconciliation or gap analysis in there as well so basically those would be the new five steps or pretty much the traditional five steps just modernized for 2020. sure and yes you talk about the integrated reconciliation of that pre-meeting what that does gathers the other three meetings together what are the issues gaps gaps to plan problems and it tries to work through solutions both financial solutions and practical solutions to sort of overcome those issues so so i think what i mean in my simple world then i mean you're looking at a basic process and it's not meetings they are a process it's not everything you do inside the company it helps enable you to do the other things you do in the company so it enables you know decision making it enables the other functional processes to work better and it's it becomes a decision-making forum for those collaboration is what happens then right well what we've known most people rarely talk about is the loop back so you go through the all these steps and processes now you have to loop it back so what do you look back inventory target levels you loop back the demand plan into supply review capacity and production prioritization decisions make this product over that product make those sort of decisions inside of the snlp process but there has to be a loop back into those functional everyday tactical operations and systems at what's at the top of the planning stack in in every company that that has an erp is a forecast that forecast has to cascade down through drp master planning mrp it has to cascade through so the demand plan as an output of snop feeds all those other applications and systems that drive decision making at a very tactical and execution level okay i only have a couple minutes left unfortunately i said we talked for a couple hours last week so we could go on and on we only have a couple more minutes for for this podcast about 20 30 of the audience i know hearing from them and statistically they're starting a new process so we laid out okay here's very mature companies here's best practices you gave a lot of great insights in there i'll probably share your infographic if you don't mind i can you know give them that visual as well but those 20 of the companies getting ready to start something where should they start with with the five step should they start with you know one where do they start i'm not a big boil the ocean guy so i don't i think you start with uh demand and start centering your operations around demand and getting a good demand plan a bad demand plan creates bad supply plans a good demand plan has it has the opportunity to create either a good or a bad supply plan so you're giving yourself an advantage by starting with demand and then and then from there you work your balancing process in your balancing process you can gradually extend the horizon so make the next two or three months and then and then make it the next year or forward then make the next 18 months but extend the horizon i think you have the opportunity to to succeed more if you start with demand and then cascade through supply no different than the planning stack you see at a tactical level so you don't start your snop process with all five steps in place and a strict rigid formula for success you already start where they're at some people say that that's what you do um i just disagree i went for the demand review process and put in an executive review to talk about the demand review and gradually mature the conversation about about all the drivers of demand and then start integrating supply and then integrate portfolio somewhere along the way i think portfolio is a more mature conversation that has to happen i agree 100 i think that's a great thing to end it on right there and hopefully i know it we don't we actually agree on this one there pat so see i'm coming around to your side of it that's what it is there you go i i feel for you inspired you know some of those 20 30 to go out and you know at least start where they are start with a demand review start with something simple and then you know build from there at their own pace if need be so great advice boiling the ocean is can be an overwhelming it's a daunting task and if you look at at how comprehensive snop is it can scare the bejesus out of you i think if you take it really simple and easy and start with demand and build from there i think i think it will lead to long-term success and a lot of affirmation as you build successes along the way so so thank you very much pat for being part of this uh that definitely provided some good insights more than i could have done myself so thank you very much thanks eric thanks for posing the question this is a fun question it was a fun and i'm sure i'll talk to you again sometime all right eric bye that was a fantastic conversation i just had with pat i said you know we had the great conversation last week i wanted to share it with you hopefully you got something out of it as well just remember snop it's a process not a meeting snop is a decision making forum it's not a reporting form an snop drives your business needs not just supply chain keep those things in mind and when you're putting together your your steps your forecast your process your snop process inside your organization whatever it may be whether it's going to be a simple four step whether you want to make it complicated and put 10 steps in it much like the snop name i personally despite what anybody else said i i don't care what you call it as long as you make it a business process to enable business able business decisions i'm okay and with that when you're looking at those process step meet the company where it is and what i mean by that is i've seen organizations that started off in finance and built a strong snop process i've seen organizations have a good demand planning function and looking at its demand planning process and then build out an snop process and that i've seen an organization that actually started with a product review meeting first and then built an snop process out of that product review yes they had a what i mean by meeting the company where it is that organization had a very strong product management organization they had a lot of products that they would put out on a weekly daily monthly basis they had a large portfolio they had to manage because of the type of organization they were product focused centric organization because of that they already had an established product review meeting on a monthly basis that it wasn't an srp it was a product review so what they did was they adapted that more into a snop type product review that brought in more organizat functions brought in more demand brought in finance brought in these other functions that they were impacting and they built out that meeting to become a strong product review from there came a demand review then became a supply resource review where they could react to that ultimately cultivating into an executive review they started to establish on a monthly basis as well so they met the organization where they were to build out these steps so what you want to do is the steps yes i'll give you the we had the best practices we know what the you know four or five steps are is the best practice but what they are to you adapt to where you are in your organization and then build on those competence the basics product review a demand review a supply or resource review whatever you want to call it and then an executive review those are the basic tenets build upon those fill in the gaps do all that other stuff outside of those if you want but those are the basic tenets make sure you get right first that's the best practice you heard i didn't mention the pre-snlp yes it can be a step and it is a step for a lot of organizations and the reason i kind of got down is because of the you know probably about 20 30 companies that i talked to best in class about half of them had a pre-snop or some had it by a different name it's an important step if you need it if you need that pre-snlp guide conciliation by all means you need to have that as part of your if it needs to be a financial reconciliation use it if it needs to be a category log up before you go into an enterprise executive snlp use it for that it has a lot of different flavors and the different ways you can actually approach that pre snop step so utilize it once again how it best fits your organization as far as the data gathering you already heard we're no longer presenting that as a step that's dynamic that's daily process now that is every part of your process no matter where you are and what you're doing same with inventory same with finance these are intricate parts and integrated into every part of your process nowadays that's what best practice is doing today it's really integrating those data gathering financial reconciliation inventory those aspects into all parts and with that you really when i say it's a process not a meeting you really need to look at not just a product review and then that's the side really product is part of every meeting there was some fast-moving consumer goods that actually had product they didn't have a product review but they had it as an as a part of the demand review as a part of their supply and resource uh gaps and part of their executive s p because product was so important so understand that you are bringing those parts into every process as well that brings us to an end of another ibf on demand i said i'm your host eric wilson please contact me uh eric at ibf.org it's eric ibf.org check out arkiva your one plan snop software solution thank them for sponsoring it and if there's anything we can do for you one of the things we connect looking at snop audit you want to exactly see where your snop stands up if you want to see where your snop is compared to these benchmarks snop is compared to other organizations if you want to know those things reach out to ibf we got an audit we can do for you very easy gives you exactly where you are as far as a benchmark and maturity opposed to these best practices opposed to other organizations so you can put yourself up against these other best in class and see exactly how you measure up thank you all once again and with that we come to an end of an ib ibf on demand thank you very much for watching to the end i'll check you out next time and don't forget wash your hands oh